I am proud to announce that my article on Canada - South Korea Free Trade Agreement (CKFTA) has just been published by Intellectual Property Magazine. You can buy or subscribe to the magazine at http://www.intellectualpropertymagazine.com/.

The publisher generously agreed to its republication, so you can read my comments below.

MUCH ADO ABOUT CKFTA

CONTEXT

On September 22, 2014, Canada’s Prime Minister Stephen Harper and Korean President Park Geun-hye celebrated the signing of Canada-Korea Free Trade Agreement (CKFTA). This article’s objective is to provide the context for and brief comments on IP-related provisions of CKFTA.

The official Canadian summary of the Agreement’s highlights states that the Agreement “will ensure that Canadian IP rights-holders can do business with confidence in the South Korean market”1..

This appears somewhat condescending given that Canada is not exactly known for being at the forefront of intellectual property protection. Just the opposite, since 1995, Canada has been on the U.S. Government’s Special “Watch List” as a country where IP protection is problematic2.. Canada’s position is that its failure to adequately protect IP is an attempt to find “an appropriate balance between the interests of IP rights-holders and the interests of users.” How using somebody else’s property without permission can ever be a right is being conveniently overlooked.

The author of this article is a Canadian lawyer and does not purport to know Korean law, but statistics for both countries’ participation in international treaties on intellectual property demonstrate that Korea takes IP more seriously. Canada is a party to 10 international treaties (of which two Canada joined in 2014)3., while Korea is a party to 184.:

Treaty

In Force Since

Canada

Korea

Berne Convention

April 10, 1928

August 21, 1996

Brussels Convention

—

March 19, 2012

Budapest Treaty

September 21, 1996

March 28, 1988

Hague Agreement

—

July 1, 2014

Locarno Agreement

—

April 17, 2011

Madrid Protocol

—

April 10, 2003

Nice Agreement

—

January 8, 1999

Paris Convention

September 1, 1923

May 4, 1980

Patent Cooperation Treaty

January 2, 1990

August 10, 1984

Phonograms Convention

—

October 10, 1987

Rome Convention

June 4, 1998

March 18, 2009

Strasbourg Agreement

January 11, 1996

October 8, 1999

Trademark Law Treaty

—

February 25, 2003

UPOV Convention

March 4, 1991

January 7, 2002

Vienna Agreement

—

April 17, 2011

WIPO Convention

June 26, 1970

March 1, 1979

WIPO Copyright Treaty

August 13, 2014

June 24, 2004

WIPO Performances and Phonograms Treaty

August 13, 2014

March 18, 2009

Many IP-related provisions of CKFTA merely reference other international treaties to which Canada and Korea are parties. This is important because Canada does not enforce international treaties directly. To have the force of law in Canada, provisions of all international conventions, treaties and agreements (including CKFTA) must be implemented in national Canadian legislation.

Add to this rather vague language of Canadian statutes on intellectual property and scarcity of precedent law—and you will see the problem. How would you know if a certain provision of an international treaty needs implementation into the national legislation if two lawyers can’t agree on what the national legislation actually is? Some Canadian lawyers, myself included, believe that extensive scope of exceptions from copyright conflicts with Canada’s obligations under the Berne Convention and TRIPS, while some others believe that it doesn’t. As a result, the parties are likely to have different assumptions about how these provisions should be interpreted.

GENERAL PROVISIONS

One of the declared objectives of CKFTA is “to achieve a balance between the rights of IP right-holders and the legitimate interests of IP users.5.” Notice that the treaty does not use the controversial words “users’ rights”, however there still remains the question, what legitimate interests do IP users have regarding intellectual property of others. Who determines what interests are legitimate? Is using someone else’s music for your YouTube videos your legitimate interest? Is copying textbooks for the purposes of education a legitimate interest? What about using pictures on a blog by a non-profit?

CKFTA reaffirms both parties’ obligations under TRIPS as a minimal standard6., confirms the national treatment requirement7., and opens the door for a more extensive protection for and enforcement of intellectual property, as long as such extensive protection “does not contravene CKFTA.8.” Which, again, brings the question of users and their rights and legitimate interests. By definition, protection of exclusive rights comes at the expense of everyone other than the owner of that exclusive right. Logically, it is impossible to unilaterally offer more extensive protection to IP owners without disturbing the “balance of interest” that CKFTA purports to achieve.

TRADEMARKS

The Treaty specifically opens the door for sound trademarks and forbids limiting registrable trademarks to those that are visually perceptible9.. This is in line with the law established in Canada after a 2012 Practice Notice by the Canadian Intellectual Property Office and the recent amendments to the Trade-Marks Act.

CKFTA requires the parties to protect collective marks (trademarks owned by an organization for the use by its members) and certification marks (trademarks for the use by anyone who meets a defined standard prescribed by the owner of the mark), whether such trademarks are protected as a separate category or not10.. While Canadian law protects certification marks, it does not (nor do the soon-to-be-in-force amendments to the Trade-Marks Act) refer collective marks.

The Agreement confirms the right (but not an obligation) of the parties to recognize unregistered, common-law, trademarks11..

CKFTA requires both parties to provide extra protection to well-known trademarks, whether or not such marks are registered, included on a list of well-known marks, or already recognized as well-known12.. Such protection must be conferred even if the goods and services are not identical or even similar, as long as using the well-known trademark in relation to non-similar goods or services “would indicate a connection between those goods or services and the owner of the trademark.” The interesting thing is that Canadian trademark regime is uncertain about the status of well-known marks. The leading case is the 2006 decision of the Supreme Court of Canada in Mattel Inc. v. 3894207 Canada Inc.13. that confirmed that difference in goods and services must be considered, however, in different cases such difference may carry greater or smaller weight. Whatever the interpretation, it is more narrow than what is commonly expected from protection conferred to well-known trademarks. Unfortunately, CKFTA does not provide more clarity whether Canada’s current standard is about to change or whether the countries would have two different standards for treating well-known marks.

CKFTA establishes no new general rules for geographical indications, so its effect on Canadian laws will be rather limited.

COPYRIGHT

The Agreement reaffirms that both parties shall comply with the Rome Convention, the Berne Convention, WCT and WPPT15.. Each party must provide that authors “have the right to authorize or prohibit all reproductions of their works.16.” Yet, there is no indication how this provision corresponds with massive expansion of circumstances where it is legal in Canada to use works without permission and despite prohibitions from the copyright owner.

CKFTA also sets forth that the parties must provide adequate legal protection and effective legal remedies against the circumvention of technological measures used by copyright owners to prevent unauthorized use of their IP17.. Unfortunately, however, this provision contains a qualification that a party may exclude from such protection instances where the measures are circumvented to do that which may be permitted through an applicable copyright exception. This is how the law stands in Canada, which completely defeats the idea behind the rules about technological measures. The point of these provisions is to give IP owners an effective way to deal with piracy by deeming that the very act of circumventing technological measures is an infringement. In Canada, only an act of circumventing technological measures for infringing purposes is deemed an infringement, so it is not enough to prove the fact of the circumvention.

PATENTS

This section affirms the standard requirements for patent protection—the invention must be new, involve an inventive step (be non-obvious), and be capable of industrial application (be useful)18.. The parties may exclude from patentability inventions related to cloning, methods of medical treatment of people and animals, and otherwise if providing patent protection to an invention would go against public order and morality19..

ENFORCEMENT

CKFTA contains provisions imposing an obligation on the parties to provide effective enforcement procedures against IP infringements and ensure that such procedures “are not unnecessarily complicated or costly” and that they do not “entail unreasonable time-limits or unwarranted delays.” It is open to a debate whether Canadian court system meets these requirements20..

The Agreement also prescribes that certain provisions must be implemented to ensure that adequate damages are available to an IP owner whose rights have been infringed, including award of “appropriate lawyer’s fees” to the party who prevailed in trial21..

CKFTA deals with several procedural matters. It contains a provision requiring both countries to have mechanisms to compel disclosure of information that may possess an alleged infringer that would be required for an IP owner to prove their case22.. It specifically addresses various preliminary orders and injunctions that may be available to IP owners.23.

BORDER MEASURES

The measures prescribed by the Agreement are in line with the Canada’s existing regime as proposed to be amended by the Combatting Counterfeit Products Act, which is due for its third hearing in parliament.

CRIMINAL PROCEDURES AND REMEDIES

CKFTA requires each party to provide for criminal procedures and penalties for the unauthorized copying of a cinematographic work from a performance in a movie theatre. Interestingly, this is the only infringement that the parties agree must be punishable criminally.

INTERNET INFRINGEMENTS

Unlike a more rigorous and effective “notice and takedown” approach, Canada has recently implemented what’s called a “notice and notice” system of dealing with internet infringements. In Canada, to avoid being held in violation of IP rights, ISPs must forward an IP owner’s notice to the subscriber (the actual infringer), but they are not required (without a court order) to disclose the subscriber’s personal information nor to ensure that the infringing materials are removed.

CKFTA does not require Canada to change this regime, but provides that a party may require that an ISP expeditiously disclose to an IP owner information sufficient to identify a subscriber whose account was allegedly used for infringement if the owner has filed a legally sufficient claim for copyright infringement24..

CONCLUSION

While the chapter on intellectual property is one of the more extensive in CKFTA it hardly adds much to the regime already established through other international treaties, such as TRIPS, WCT and WPPT.

While free trade between countries is certainly desirable, to present the IP-related chapter of CKFTA as a legal breakthrough for either Canada or South Korea would be a serious exaggeration.

Who would have thought that the week before Christmas would be so fruitful on important decisions in the area of intellectual property.

First, the Supreme Court of Canada has delivered a landmark decision in Cinar Corporation v. Robinson. In it, the Supreme Court of Canada unanimously dealt with many crucial issues pertaining to how copyright cases will be resolved in the future:

– the scope of protection afforded by the Copyright Act;

– the meaning of the words “substantial part” that set out the threshold for copyright infringement;

– rules regarding disgorgement of profits;

– rules regarding non-pecuniary damages; and

– rules regarding punitive damages.

Despite Supreme Court’s unanimity, this decision in fact further blurs the line between unprotectable ideas and protectable expression of ideas by adding a significant degree of subjectivity in the analysis. The Court refused the approach whereby the court first determines the original elements in the plaintiff’s work, then filters out unprotectable elements from that list, and, finally, compares the remaining protectable original features with what was actually used by the defendant. Instead, the Supreme Court preferred the holistic approach where “The character of the works will be looked at, and the court will in all cases look, not at isolated passages, but at the two works as a whole to see whether the use by the defendant has unduly interfered with the plaintiff’s right.”

This case likely turned on the single issue that defendants had access to the plaintiff’s work and knew that plaintiff would object to their use of it. The court wanted to land a helping hand to an author who failed to carry out a project whereas a very similar project was later carried out by several parties some of whom were originally involved in the plaintiff’s project.

It is what some lawyers call “the degree of sneakiness” that decided the case. In other words, the entire copyright law analysis only happened after the judges internally decided that the plaintiff should be rewarded and the defendants should be punished.

While I typically always support those whose rights are infringed in copyright law suits, this may be the case when bad facts make bad law, because I’m not sure that I agree (from the description of the two works, and without having had a chance to compare the actual works) that what was used was more than unprotectable idea.

Time will tell what this case will mean in terms of development of Canadian copyright law.

I already wrote about the facts of the case with a brief analysis before, but briefly here they are again: a BC flooring company that’s been around for over a decade realized that its competitor, another flooring company from the same city trademarked the word “Woodpecker” as its own.

The dilemma – do we spend a ton of money on rebranding or do we spend a ton of money on lawyers to fight this through – was entirely avoidable. All the first company had to do was register its trademark first.

They decided to fight for their trademark. BC Supreme Court granted an injunction recognizing the first company’s prior right in the trademark. Now, the BC Court of Appeal has agreed.

Happy ending? Not really, unless you mean a happy ending for all lawyers involved in this case.

Now that the case has been through the BC Supreme Court level and the Court of Appeal level, the first company has probably spent close to 100 times the amount that it would have cost them to register their trademark when they were starting out.

If anything, it would have been a good insurance policy.

Remember, registering trademarks is within the reach of any business that’s more than just a hobby. It’s a long-term investment that is crucial for any business that spends time, money and energy on branding and marketing.

Often, I get requests to draft a simple agreement whereby the business owner who paid or is about to pay for some content created specifically for that business would own copyright in what they pay for.

Just today, I got a call from an existing client. They hired a videographer to create videos for their business. Now the videographer is claiming that my client does not own copyright in the videos. However surprising this may be to most people, the videographer is correct, at least from the legal standpoint.

Unless there is an assignment of copyright in writing, the copyright remains with the person who created the work, in this case, the videos.

Often, the client’s situation does not justify hiring a lawyer to create a completely customized agreement.

So I decided to share the template that I developed as a result of many years of writing these agreements in different jurisdictions.

If you hired someone to create content for you or you are about to hire someone to create content for you and you don’t have a budget to document the transfer of intellectual property from your contractor to you, you should definitely check out these templates. They may not ideally fit your situation and are not offered as legal advice, but in my experience, they should take care of 90% of the situations that usually arise around such facts.

This is where you can download standard Content Creation and Copyright Assignment templates at a fraction of what it would cost you to have a lawyer draft a customized contract. Check out the previews and see for yourself that the level of details covered in these templates greatly exceeds anything that you can download for free on the Internet.

The information on this website is for general information purposes only. Nothing on this website should be taken as legal advice for any individual case or situation. This information is not intended to create, and its receipt or viewing does not constitute, a solicitor-client relationship.